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Development of the solar energy market in Germany: trends and forecasts – OneStep.Solar

2024-04-17

The Future of Solar Energy in Germany: Trends and Forecasts

The key term in connection with the solar energy market in Germany is the "energy transition." This term describes the shift from generating energy from fossil fuels like coal, nuclear, and gas to sustainable energy production from the sun, biomass, and wind. The foundations for this were laid by the environmental and anti-nuclear movement of the 1970s.

Thus, solar power and solar energy in general are central pillars within the energy transition. This article will highlight the key points of current and future use of solar energy.

Current State of the Solar Energy Market in Germany

According to the Federal Network Agency, at the end of 2023, solar installations with a total capacity of 81.7 gigawatts were installed. In the current year alone, solar installations totaling 14.1 gigawatts were connected, about twice as much as the previous year. Surprisingly, mainly private installations were implemented, but commercial ones as well. The reasons for the many private investments include steadily rising energy prices and global uncertainties in politics and the economy. Many people are trying to become somewhat independent from the public grid with the help of solar energy. This is evidenced by another impressive number. About 70 percent of all installations are equipped with a battery storage system to use the generated energy as efficiently as possible. The German government has also managed to give a significant boost to the sector of small solar installations or balcony power systems with new and simplified regulations. About 260,000 such installations are already registered, which represents a share of 1.5 percent of the total market. However, it is assumed that the actual number is much higher, as not all installations are registered. Balcony power systems are a good way to optimize one's energy costs without much bureaucratic effort, for both tenants and owners.

Key Drivers of Solar Energy Development

The most important drivers are climate and environmental protection and the associated concept of sustainability. Based on this, political goals are defined that, with laws and regulations, aim to advance the expansion of renewable energies. For example, there are a number of incentive programs that encourage the expansion and also motivate companies to achieve technological advances. Rising energy prices further make decentralized energy supply more attractive.

Challenges and Solutions in the Solar Energy Market

Although the renewable energy sector is making great strides, the challenges in solar energy are immense. One of the biggest challenges is the issue of storage capability. During the winter months or so-called dark doldrums, hardly any energy is produced. Therefore, it is necessary in the long term to develop storage solutions to solve this problem. However, significant technological advancements are being made in both the solar industry and storage technology, which give hope that these challenges will soon be under control. The economic incentives for solar installations and corresponding storage systems are simply so convincing that this path seems to be the right one.

Forecasts for the Future of Solar Energy in Germany

The growth of solar energy in Germany is expected to continue. The solar installation with connected battery storage is increasingly becoming standard in the construction industry and is typically an integral part of modern smart home concepts, which aim to optimize the energy balance of a building. But it's not just cost reasons that are making the solar energy market grow. An important driver is the increasing environmental awareness among the population. One of the most important trends in solar energy, therefore, is the integration into systems that efficiently control the energy flow. What currently applies to households could be important regionally in the future, for instance, when power storages like those from battery-powered vehicles or home storages are controlled centrally.

Impacts on Economy and Environment

Even though there are still areas in the manufacturing process of solar installations that are currently not satisfactory and thus the effects of solar energy on the environment are not yet 100 percent convincing, it must be clearly stated that solar technology is the most promising. Continuous improvements are being made in terms of environmental compatibility, both in raw material extraction and in recycling.

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